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RAA: U.S. Reinsurers See 5.7% Growth in Net Premiums for First Half of 2012

U.S. reinsurers saw their net premiums rise 5.7% in the first six months of the year, while combined ratios improved to 91.5, according to the Reinsurance Association of America.

The RAA's survey of 19 U.S. property/casualty reinsurers found the group's net premiums rose to $14.6 billion for the first half of 2012 from $13.8 billion for the same period last year. While the group wrote more business as a whole, only nine of the 19 reinsurers in the survey saw their net premiums increase during that time: Berkley Insurance Co., EMC Reinsurance, Munich Re America, National Indemnity Co., Odyssey Reinsurance Group, QBE North America, Scor U.S. Group/Scor Re, Toa Reinsurance Company of America and XL Reinsurance America.

National Indemnity, the largest company in the survey by policyholders surplus, had a the largest dollar gain, growing $817.2 million to $3.95 billion in net written premiums for the first half of the year. Scor, which grew to $422 million in net premiums, and National Indemnity both grew by 26%, the biggest percentage jump among the 19 companies.

The companies that reduced their writings most dramatically included Sirius America Insurance Co., which saw a 61% drop in net premiums written to $129.1 million, and Endurance Reinsurance Company of America, which saw a 44% drop in net premiums written to $108.7 million.

While the overall group's combined ratio improved to 91.5 from 116.2 for the same period a year ago, individual performance varied widely from company to company. General Re Group posted the lowest combined ratio of 73.7, followed by Everest Reinsurance Co. with 79.7 and National Indemnity with 81.1. Both General Re and National Indemnity are Berkshire Hathaway companies.

On the other end of the spectrum, the three companies with highest combined ratios for the first half of 2012 were: American Agricultural Insurance Co., with 111.8; Scor U.S., with 108.9; and Endurance Reinsurance Corporation of America, with 108.7, according to the survey.

The group's total policyholders surplus was $117.4 billion, up from $115.9 billion at the end of the first quarter 2012. National Indemnity alone is responsible for $75.8 billion in policyholders' surplus.

In a word, resilient might best describe the financial position of global reinsurers, considering the volatile economic conditions and the frequent and severe loss events of 2011, A.M. Best Co. said earlier this year. The only year that produced larger cumulative insured catastrophe losses than 2011 was 2005, when hurricanes Katrina, Rita and Wilma in combination with other smaller events, produced about $125 billion in industry losses, compared with the $110 billion in losses in 2011.